Change Of Exchange Rate Regime To Influence On GDP On Positive Analysis

A constant exchange rate regime can't suit all the countries or every period of one country. Every country chooses appropriate exchange rate regime depends on the degree of the development of its economy and finance. Although the goal of the exchange rate regime is multiple, whether it can promote GDP is an important standard. The choice of exchange rate regime plays an important part in International Finance and Development Economics. Theoretical study and positive study try to seek the most appropriate exchange rate regime by studying the influence of different exchange rate regime on macro economy and financial variable. With the progress of marketlization, reform of exchange rate regime will make great influence on every respect of economy; therefore, study of how the change of exchange rate regime makes influence on the increase of GDP is meaningful.This paper first reviewed theory of institutional determination and explored the significance of the influence of exchange rate regime which made on economic development. Then, we systemically introduced classification of exchange rate regime and its choice theory as well as the choice of exchange rate regime and the increase of GDP, these provided necessary theoretical support for the introduction of mechanism of exchange rate influence GDP and the positive research of the relationship between exchange rate regime and GDP.The second part of this paper analyzed the transmit mechanism of the change of exchange rate regime how to influence on GDP. Exchange rate regime as a property rights arrangement which determines the flexibility of exchange rate regime, the determination mechanism of exchange rate level and the arrangement of foreign exchange market. Subsequently, they will perform different stimulation function to property rights traders. Therefore, there would be different trading behavior and their behavior will reflect into economic life which will influence determining factors of economic development and promote or hinder increase of GDP. We introduced exchange rate regime how to influence GDP from three aspects including capital, technology and government behavior.The third part of this paper is positive analysis. We first retrospect the exchange rate regime of our country and utilized pseudo variable method to quantify exchange rate regime. We worked out an econometric model and induced exchange rate variable to the quantitative analysis model of marginal propensity to consume and marginal propensity to import. Finally, we made conclusions and explained the phenomenon.In the fourth part of this paper, we put forward some perspective to our country's future exchange rate regime reform.